Borodino moves processing capabilities to Volgograd
facilities to Volgograd in January 2005 as a means of strengthening
its position in the market, writes Angela Drujinina.
When the company bought over Slavianka, it acquired a huge but under-used production capacity. According to rough estimations, its lines have the potential to output up to 400 tons of confectionary products per month, even though current production volume has not exceeded 250 tons a month.
The move will be third in the company's history. Almost a year ago, Mona confectionery, a member of the Borodino Group, moved out of Moscow city towards the suburbs following a ruling from the Moscow government that all production facilities should move outside the Moscow Beltway (the MKAD).
Borodino plans to load the entire capacity of Slavianka in January 2005. It hopes to achieve this by joining up production from Slavianka and Mona, and expanding the range of confectionery produced by Borodino.
Mona confectionery produces a wide range of confectionary products, including premium chocolate sweets. The production volume at Mona reaches 90 tons per month.
Borodino managers estimate that the relocation of production to Volgograd will allow the company to strengthen its positions on the market. Substantial investment will be spent on modernising production equipment and increasing production volumes. This, claims the company, will help achieve significant production efficiencies and enable the firm to compete by offering lower prices.
For Volgograd, the arrival of Borodino is also potentially profitable. The Moscow-based holding will hopefully strengthen positions within local production and create hundreds of new of jobs.
Borodino is one of the biggest Russian trade and production holdings. It produces and sells low-alcohol cocktails (Otviortka and others) energy drinks (XXL), juices, nectars lemonades 7ß, mineral water, confectionery and ice-cream. The company also owns a packaging production plant.
The holding is a network of independent enterprises. The turnover of the group in 2003 was about $200 million.
